Ethiopia: Reasons Ethiopian Coffee Export Market Declined

Addis Ababa (HAN) June 9, 2014. According to the Ethiopian Trade Ministry, ”Ethiopian coffee exports have declined 50 per cent in the last ten months.” According to Geeska Afrika Online market reporter, Arabica coffee prices are currently ruling at much lower than the cost of production for growers.

The rise in the prices of inputs such as fertilizers, diesel and labor costs have gone up adding to the rise in cost of production. The robust variety saw higher shipments during the last two months of the fiscal, while Arabic has seen a declining trend as Brazil and Indonesia have pumped up coffee volumes.
The Ethiopian coffee decline in exports is mainly due to weak European demand, particularly from European nations like Germany, Italy, Spain, Greece and Portugal as buyers in these countries were looking for cheaper coffees. Though we had expected a decline in exports in the range of five per cent this year 2014, the final figure for the year is much higher,” A Member of Coffee Exporters’ Association of Ethiopia, told Geeska Afrika Business reporter in Djibouti.

Ethiopian coffee exports account for around 3 percent of the global coffee market.Coffee bean exports from Ethiopia, the third largest exporter in the world, fell to more than 10,000 tonnes.

Ethiopian Coffee exporters have complained that the federal budget was complicated and affected their trade. They have also complained about the quality of the coffee exported to Europe and America.

Coffee was exported in Ethiopia by mass without taking into consideration its quality and geographical aspects. This affects our coffee exports in the budget year, said by one of the business community leader..

The regional security change could reduce or increase Ethiopia’s coffee exports as well.In the Ethiopian report: Ethiopian Trade Ministry said that Addis Ababa had exported 136,000 tons of coffee worth $489.28 in the last ten months, compared to $576.819 in the same period last year.
According to the trade ministry, coffee exports declined by 8.79 percent and revenues by 15.8 percent in the last ten months compared to the same period of 2013.
The ministry cited power disruption, delay in business deals and market price fluctuation for the decrease in coffee exports.

Ethiopia: A major exporter of coffee in Africa continent
The biggest market for Ethiopian coffee is Germany, which imported $95.75 worth coffee during the last ten months, according to the trade ministry report.
Saudi Arabia was the second largest market for Ethiopian coffee followed by the United States, Belgium, Sudan and Britain.Photo: The Kenyan business Delegation with Minister of Foreign Affairs Tedros Adhanom, Kenyans asked the Ethiopian government to eliminate bottlenecks.

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1 COMMENT

a son of coffee farmer, I feel the impact. I can forward two options for the the problem. Look at this reason that has been mentioned in the report: “The Ethiopian coffee decline in exports is mainly due to weak European demand, particularly from European nations like Germany, Italy, Spain, Greece and Portugal as buyers in these countries were looking for cheaper coffees” If that is the case, let’s work on utilization of mineral fertilizer that can boost our coffee productivity i.e from the current national coffee productivity which is about 5 Qt/ha to 20 Qt/ha. By doing this we can address the interest of our customers as they are looking for cheaper coffee. It is obvious that the current “organic coffee price” is not paying the yield penalty of 15 Qt which is the consequence of not using modern agricultural input as Brazil and Vietnam do. This strategy had double advantages: it increase Ethiopia’a national average coffee productivity and thus production i.e. higher yield leads to higher income to the farmers as well as for the nation. Second it can address the interest of customers as I have mentioned above they are looking for cheaper price-low cost.
The other option for the current Ethiopian coffee market problem is that, of course it may be long term solution, looking at China. Some reports have showed that the China coffee market is growing by 30% annually. The average annual per capita coffee consumption in metropolitan cities of china (Beijing, Guangzhou and Shanghai) is only around 20 cups. We may therefore conclude that China’s consumer coffee market has enormous room for future Ethiopian Coffee.

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